On Wednesday 12 July, NFDA joined Auto Trader’s ‘How is the rise in interest rates impacting the marketplace’ webinar, which was broadly broken down into two key areas: What the data suggests the market is at, and how interest rate changes are influencing this.
Catherine King, Senior Data Analyst
Initially, Catherine provided an outlook into how the market is performing, particularly over the last 4 weeks since the announcement of the latest hike in interest rates. In the last 4 weeks, Demand for used vehicles has +4.9%, but Supply has fallen -3.5%. This has resulted in an over Market Health of +8.8%.
When analysing used cars market health, by comparing age – 5 – 10 year old cars are performing the strongest.
Catherine Faiers, Chief Operating Officer
Catherine Faiers explored the economic climate, and how this may or may not be affecting consumer confidence. From the data, it suggests that consumer borrowing is now back to pre-pandemic levels yet we are not yet seeing this have an impact on consumer confidence and spending.
In fact, from Auto Trader insights, 85% are still just as confident in buying a car compared to this time last year and 75% are still actively looking to buy a car. Website visits on Auto Trader are also up 11% year-on-year.
With factors such as Public Transport Strikes, unreliability and the ever present desire for independence and transport freedom, private mobility is still considered a necessity to motorists.
James Standing, Senior Client Development Director
- Overall, Auto Trader are seeing rates continue to climb, particularly on new cars which have a very low baseline.
- Used APR rates were already at a high baseline, with lower increases overall but with further increases expected.
- Certain lenders are increasing rates faster than others, but the overall increases across the platform average and top 10 average are not substantial.
- Higher finance engagement on Auto Trader than pre-pandemic, +49% used finance interactions on the platform vs 2019, which highlights that finance is increasing in importance to consumers.
- Not seen any significant changes in finance terms, mileage customers are selecting when submitting finance leads.
How is interest rates impacting the market place? - Slide Pack
Consumer confidence and Finance update – Slide Pack
Full webinar link – Access Here